Ghana: Aker Energy Backs Gov’t’s Decision To Amend Petroleum Agreement Covering DWT-CTP And SDWT Oil Blocks

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Aker Energy, a Norwegian oil and gas firm which is operating the Deep Water Tano Cape Three Point (DWT/CTP) oil block in the Republic of Ghana, has backed the government’s decision to amend the Petroleum Agreement covering Aker’s oil block.

According to sources within Aker Energy, the amendment is in the right direction, adding that the amendments are in line with international best practices and would reinforce Ghana as an attractive place to invest.

“The main beneficiaries of the projects is Ghana due to tax revenues, employment and local content,” a source at Aker Energy said.

The Akufo-administration, through the Ministry of Energy, requested the country’s Parliament to amend the Cape Three Points-Deep Water Tano (CTP-DWT)(Aker) petroleum agreement and South Deep Water Tank (SDWT) (AGM) Production Agreement.

The decision did not sit well with the Minority MPs in Parliament, who accused the President of presenting a ‘Christmas gift’ to the Norwegian oil and gas firm and denying Ghanaians the benefit.

“This ‘Christmas present’ represents the most radical attack on Ghana’s upstream petroleum sector since the commencement of the fourth Republic,” the Minority described.

According to a statement by Minority, “The amendment of the petroleum agreement would impose certain critical obligations on the sector Minister, which are regulatory in nature, limit the Minister’s discretion in approving plan of development(POD) contrary to Act 919 for example, by compelling the Minister to use FPSO technology as the only option for producing the resources of the AGM Block even before the appraisal of the field in which the technology must be deployed, compelling the Minister to accept the contractor’s delineation of the area to be included within a Development and Production Area in the Aker block, allow Aker within a year of its Final Investment Decision to unilaterally vary the approved development plan without reference to the Minister contrary to Section 27(12) of Act 919, give contractor’s unfettered discretion over oilfield procurement without recourse to petroleum commission or any other governmental authority, thus, weakening the role of GNPC in joint Management Committee.

“The direct beneficiary of these giveaways would be the Norwegian Multinational, Aker Energy which owns and controls north Aker Ghana and AGM. The direct loser is Ghana. The cumulative medium to long term effect of all these giveaways would be a loss of national control over our precious petroleum resources which would lead, among other things, to billions of dollars lost to the nation and loss of job creation. These amendments would lead to demands from contractors across the board for review of their current contract terms in order to achieve parity of treatment,” Minority argued.

However,  reacting to the Minority’s claims, sources at Aker Energy said Ghana rather stands to benefit immensely from the oil block, saying the development of both blocks are needed to achieve Ghana’s oil production target.

“Aker is the right partner for Ghana given the ultra-deep waters with its high risk and complexity. Aker, which developed the Norwegian oil sector, is known for its broad skillset and technology portfolio.”

ABOUT AKER ENERGY:

• Building a Ghanaian oil and gas company: Operating the DWT/CTP block, building on Norwegian
knowledge and expertise. Planning to significantly build up the organisation in Ghana.
• Proud industrial heritage: Building on 180 years of experience from the Aker group, which employs
30,000 people in 60 countries. Has taken part in 80% of developments in Norway.
• Developing the fourth producing field offshore Ghana: Ultra-deep water project with estimated
investments of USD 4.4 billion (plus cost of FPSO). Ambition to significantly improve oil recovery.
• Commitment to industry development: Established Aker Ghana Investment Company (AGIC) to
develop local industry. Pledged $4.5 million to AOGC program to enhance competence in the industry.

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